A Few Areas I Am Confused About, Please Comment

You can't go into this with discrete CPU and GPU budgets. I'd say you're looking at a 3930K or 3960X workstation, Sandy Bridge-E. I don't know much about Xeon, but I don't think it'll be worth the money.

What is your entire budget? how long can you wait? Wait for the sandybridge 8 core xeons.

My dudget is about 3500-5000 for everything. I am open to any suggestions! When are the 8core sb xeons coming out/ how much?

bump

Unless Autodesk has changed things dramatically in the last couple years, video cards do not improve render times, the CPU is what does the rendering. A good GPU is important for keeping a good FPS and preventing lag while working within your scene, the more complex the scenes your working on(more advanced lighting, more polys, etc) require more graphics power to render in real time as you do your work. The final render that you output for video/images gets done by the CPU.

I would invest more into the CPU rather than GPU, but I'm not entirely sure what type of work your doing. I don't use 3ds max for anything professional, but I've got a Phenom II X6 and radeon 5670 and haven't had any performance issues, wish I had a stronger CPU though cause it can take for ever to render at times.

Oh and I7 isn't newer or better than Xeon, Xeon is just the name of Intel's server parts, there have been I7s and Xeons built on the same processor architecture and the xeons end up with more cores and better performance for workloads that can use those cores.